MOL Targets Revenue Growth

MOL Targets Revenue Growth

MOL, the only one of the three big Japanese shipping lines to project a profit in its 2009 fiscal year ended March 31, is setting a goal of generating revenue of $1.066 billion in fiscal 2010, ending March 31, 2011.

In a speech Friday on the line’s 126th anniversary, MOL President Akimitsu said the company has managed to turn a profit in the 2009 fiscal year “despite the tough economic conditions” because he had asked the company five years ago to prepare “mission Sakaro,” which means a scull that can move backwards.

In February, MOL revised its projected revenue for fiscal 2010 up by 3.8 percent to $15 billion and its net income up 150 percent to $55.7 million.

At that time, MOL said it anticipated growing container volume and progress toward a recovery in freight rates in the liner sector. Strong demand in China for iron ore and coal and increased global demand for petroleum products indicate that its dry and liquid bulk operations will also improve.

In his speech Friday, Akimitsu said MOL had scaled back plans to increase its fleet size (including tankers and dry bulkers as well as container ships), cutting the target from 1,000 to 900 vessels as of the end of March next year.

MOL, the world's 11th-largest container line by capacity, had a fleet of 93 containerships as of April 1, of which it owns 26 and charters 67, according to Alphaliner. It has 24 new ships on order, which represent 39.4 percent of its existing fleet.

The container business, which “suffered large deficits” because of the recession “is now scaling back its fleet size to the minimum required operational level,” Akimitsu said.

Akimitsu said the company “has almost exhausted the allowance for countermeasures prepared for “mission Sakaro” and is now preparing for a new mission as the economic recovery progresses.

He said he expects the container business “to achieve a turnaround in the term of this plan and once again fly high in the warmth of spring.”

Contact Peter T. Leach at pleach@joc.com.